Opportunity Zone Tax Credit
Stephens County and other local governments which undertake redevelopment and revitalization efforts in certain older commercial and industrial areas can now qualify those areas for the State’s maximum job tax credit of $3,500 per job. The incentive, which is available for new or existing businesses that create two or more jobs, is a Job Tax Credit which can be taken against the business’s Georgia income tax liability and payroll withholding tax. The credit is available for areas designated by DCA as an "Opportunity Zone." DCA will consider designations for areas that are within or adjacent to a census block group with 15% or greater poverty where an enterprise zone or urban redevelopment plan exists.
Opportunity Zone Tax Credit Incentives:
- the maximum Job Tax Credit allowed under law - $3,500 per job created
- the lowest job creation threshold of any job tax credit program - 2 jobs
- use of Job Tax Credits against 100 percent of Georgia income tax liability and withholding tax
- provides for businesses of any nature to qualify, not just a defined "business enterprise"
The benefit to a business locating within the boundaries of a designated Opportunity Zone, where the business creates eligible net new jobs to Georgia, is the Georgia Job Tax Credit.
Eligible industries: Any lawful business may qualify for eligible net new jobs created at a business location within the boundaries of a designated Opportunity Zone.
Threshold Job Creation: Minimum of two eligible net new jobs within a single tax year, but if only two jobs are created the persons in those jobs cannot be married to each other.
Net new jobs must meet three criteria to be eligible for the Job Tax Credit:
- Must be permanent full-time jobs working a minimum of 35 hours per week;
- Must pay in excess of the lowest average wage of any county in the state; and
- Must be offered health insurance upon employment, although the employer is not required to pay for such insurance.
If the business meets the eligibility criteria, then the allowable Job Tax Credit is $3,500 per eligible net new job.
The job tax credit is first applied against any income tax liability on the Georgia Corporate Income Tax Return, with any excess job tax credit eligible to claim against Georgia payroll withholding taxes if the proper steps are taken with the Department of Revenue. The credit is available to be claimed for five years, as long as the jobs are maintained. Therefore, a small business which creates two (2) eligible net new jobs and then maintains those jobs for five full years should be able to claim a $7,000 tax credit each year ($3,500 per job x 2 jobs) for five years, for a total tax credit of $35,000 ($7,000 tax credit x 5 years).
The tax credit has a 10-year carry forward provision from the year in which the jobs are created. The carry forward period is the same for job tax credit claimed against either income taxes or payroll withholding taxes.
There is no limit on the number of jobs that may be claimed under the Program, only that the jobs meet all eligibility requirements under Code and regulation. Click here to access the Job Tax Credit page for additional information and forms.
The SCDA is responsible for the recruitment of new businesses including industrial, manufacturing, distribution, corporate and regional headquarters and customer service centers. It also provides support and assistance with all other types of economic development projects.
The SCDA also works with existing businesses and industries to ensure their continued success. While recruitment of new industry is a significant function, aiding in existing industry expansion and retention is just as significant. About 80 percent of all new jobs in Georgia come as a result of existing industry expansion.
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